Managing Conflict in the Family Firm

22 Feb Managing Conflict in the Family Firm

Historians say that the costliest of all human conflict is civil war. When brother picks up arms against brother, there are no winners.

A family business can inherently be a combative environment to operate within. Anyone who has ever sat at a Thanksgiving dinner probably has seen firsthand that tensions can occasionally arise from proximity to certain family members. Add the pressure of meeting a payroll or pleasing shareholders and you have set the stage for tension to emerge. Many family businesses that fail don’t go under due to any particular problems in the marketplace or with the work it produces – often the greatest challenge is simply in managing the human element. Ineffective communication and mismanaged conflict can prove fatal.

Some conflict is to be expected – this is only human nature. Most every family goes through this – it isn’t limited to the Sopranos. More important than maintaining perfect harmony at all times is ensuring that your business has a strategy in place to mitigate and resolve disputes when they do emerge. With the right conflict resolution infrastructure in place, you may even be able to turn such disputes into opportunities to step back and examine important strategic considerations involving your business.  At the heart of every dispute resolution system lies this question: “What are we going to do if we can’t agree?”

All the planning in the world won’t mean much if you don‘t take the initiative to address the conflicts at the root of your company’s challenges – going “below the line.” This is typically where the real issues lie. They may have been driven by processes or personalities for years, to the point where you can hardly recognize the root causes anymore. Here are some strategies to help turn a messy skirmish into a more productive exercise.

  • Always maintain calm. This is easier said than done, but adopting a long term perspective and resisting the urge to take disagreement to a personal level will improve the tone considerably. Remaining calm can also help you to stay persistent and ultimately emerge from the dispute in a stronger position. Be sure to work with advisors who are neutral and yet have your best interests at heart.
  • Maintain the creativity of an open mind. In most situations, there are multiple paths to bring everyone to a place of satisfaction. Try to look outside the narrow parameters that seem to have been drawn up to resolve disagreements. There is typically a root cause below the surface that can be considered even if a demand cannot be met. For example, an employee who can’t be permitted to begin teleworking may simply be yearning for a greater degree of autonomy in their work which a revised schedule of their business offers may help to provide.
  • Maintain a bias toward collaboration. A famous African proverb reminds us that “to go quickly, go alone. To go far, go together.” I have seen throughout my career how many a flare-up could have been avoided through a proactive “FYI” ahead of a decision being made. Respect that most professionals’ sense of worth is dependent on feeling valued and “in the loop” on big decisions. Consulting them ahead of time can save you a messy dispute later on.

Challenge and conflict are inevitable at some point. But tearing your family apart is not a viable strategy for ultimately creating wealth. Reconsider how you think of conflict – find ways to minimize the acrimony. You can choose to make these periods illuminating experiences – and emerge with a stronger foundation for your company and relationships.

What experiences have you had with conflict resolution, formal or informal? What strategies have worked for you?


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